By Jack Hough

They could do worse; it sells for 16 times projected earnings for Apple’s fiscal year ending this month, versus 14 times for the broad market. But with some slight math contortions — using next year’s higher, projected earnings and subtracting the company’s cash and investments from its stock price — the valuation drops to 11 times earnings.

Then again, Apple is already the largest company in America by stock market value, so don’t expect its shares to double soon.

As an alternative, there’s always a one-off iPhone stock, like Qualcomm, maker of the chips that power the high-speed data connections smartphones rely upon. But it sells for 18 times earnings.

Smartphones and tablet computers dented sales of personal computers, and investors view that as a troubling sign for hard-drive companies like Seagate. Tablet devices use speedy “flash” memory, and they don’t need much of it, because users increasingly store their videos, photos and other large files online using “cloud” services.

But those files must be stored somewhere, and that somewhere is the vast data centers like the kind being built by Apple, Amazon (AMZN) and Hewlett-Packard (HPQ). Data centers have endless demand for hard drives, which hold a sizable lead over flash drives (which Seagate also sells) when it comes to storage capacity and reliability.

In 2010, 62% of data storage was shipped for individual use, but by 2020, Seagate reckons 61% will be used for cloud computing.

Seagate shares sell for just 4.5 times trailing earnings, and its earnings per share are expected by Wall Street to increase 10% over the next four quarters. The ultralow valuation reflects a belief among investors that Seagate is a PC-era stock in a post-PC world. But management last quarter pointed to “exceptional growth” from cloud-computing customers.

The stock gained 90% this year, topping Apple’s 69% rise. Part of that climb is owed to an industry recovery from flooding in Thailand last year that closed hard-drive factories and left supplies short. Part may also be owed to Seagate gradually proving that it can profit from the rise of iPhones and similar devices rather than fall victim.

At its current stock price, Seagate doesn’t need to provide world-beating growth to offer handsome returns for investors. Last quarter, the company spent a whopping $1.2 billion to repurchase its shares — that’s 10% of its current stock market value. And Seagate exited the quarter with $2.2 billion in cash and equivalents, up from $2 billion the prior quarter.

Share repurchases reduce a company’s share count and can increase the value of its remaining shares, but they work best in cases where shares are cheap. Seagate looks to be getting an excellent deal on its repurchases, and the pace of its program is as aggressive as they come.

The stock also carries a dividend yield of 4.3%, more than double the S&P 500 index’s yield.